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Small Business Tips

Mileage Reimbursement Mistakes Businesses Make

Marin Perez

You know that a proper mileage reimbursement program can save your business time, money and boost compliance. Yet, we've seen many companies make mistakes with their programs. Here are some of the major mistakes your business should avoid.  

Not Having A Clear Process

Nearly half of businesses with mobile employees don't have a clear process or policy for mileage reimbursement. Some companies require a mileage log, while some really want one but still pay out reimbursements anyways because they don't want to upset workers.    

A clearly-defined process and policy makes things easier for everyone involved. It saves money by ensuring employees are paid the proper amount. It boosts productivity by giving workers a clear way to handle this expense. Finally, a clear process safeguards financial records from future scrutiny.    

Don't forget: It's tough to have a clearly-defined process and policy without the correct tools.  

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Automatic, accurate mileage reports.

Relying On Manual Reporting

More than half of businesses that actually have a policy rely on manual expense reporting. This leads to squandered budgets and wasted employee time. This is especially true when it comes to a mileage reimbursement.    

It's standard to require receipts for expenses like hotels, flights or meals with clients. It's also pretty easy for employees to keep these or snap a picture. Yet, with mileage, many businesses are fine with reimbursing without standardized documentation. This leads to reimbursements that may or may not be accurate.    

If your business requires a handwritten mileage log or a spreadsheet, these can easily be doctored in the employee's favor. Even in the best-case scenario, your company is burdening mobile workers with the drudgery of logging every single business drive.    

You're not paying people to log miles and fill out tedious expense reports. Give them the right tools so they can do what they're best at.  

Choosing A Solution That Doesn't Fit Your Needs

A manual mileage reimbursement process clearly doesn't work. It wastes money, time and opens you up to compliance issues. That's why many businesses choose a technology-enabled solution for mileage reimbursements.    

Be sure to choose one that actually fits your needs. Because mileage can be such a big problem, it's easy to choose something you may not even need. Your buying criteria should be centered around saving money, boosting productivity and enabling compliance.    

The last thing you want to do is save money on mileage reimbursements but lose those savings because you're paying too much for your mileage tools. Likewise, you may lose productivity gains if you have a hard-to-use solution that takes months to implement.  

Download MileIQ to start tracking your drives

Automatic, accurate mileage reports.

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